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Thursday, May 11, 2017

Najib in for awkward meeting with China leaders after Bandar Malaysia twist

Najib Abdul Razak is set to meet Chinese President Xi Jinping and Prime Minister Li Keqiang during his five-day visit to China, but the Malaysian prime minister appeared to be more keen about his new friend, Alibaba founder Jack Ma, compared to the agenda with the Chinese leaders.
In the latest blog posting, Najib spoke at length about his planned meeting with Ma, but was mum on speculation that he would be attempting to court China's largest private property developer Wanda Group, owned by Wang Jianlin, China's richest man, to take over the Bandar Malaysia development.
But before the prime minister even considers enticing a new Chinese developer, he would first need to explain to the Chinese leadership why he jettisoned China Railway Engineering Corporation (CREC) from the lucrative deal to purchase a 60 percent stake in Bandar Malaysia.
Unlike Wanda Group, which is a private entity, CREC is 100 percent owned by the Chinese government, which might not take kindly to Putrajaya's decision.
IWH-CREC, a consortium comprising Johor-based Iskandar Waterfront Holdings (IWH) and CREC, was to acquire 60 percent of Bandar Malaysia for RM7.41 billion.
The consortium had ambitious plans for Bandar Malaysia, and had taken out full page advertisements in several major newspapers last year, featuring a conceptual design of the city with the title, "On track for the future".
However, Putrajaya last Wednesday abruptly derailed the consortium, accusing it of failing to make the necessary payments, which the consortium disputed.
The collapse of the Bandar Malaysia deal opened up a can of worms, including reports that not all in the government were on board with the termination, as well as whether 1MDB or the government would be refunding the RM741 million deposit.
The scandal-plagued 1MDB has transferred the Bandar Malaysia asset to the Finance Ministry as part of a rationalisation plan to pare down its debts, which amounted to around RM50 billion at its peak.
Najib will need to ensure he does not upset the Chinese government, which has other ventures in Malaysia through its state-owned entities.
This includes the RM55 billion East Coast Rail Link by China Communication Construction Company Ltd, a publicly-listed but majority Chinese government-owned company.
While the focus is on what would become of Bandar Malaysia during Najib's trip to China, the prime minister spoke on matters unrelated to 1MDB, which has plagued his premiership for years.
"Apart from meeting (China) president Xi Jinping, prime minister Li Keqiang and other Chinese leaders, my delegation will be travelling to Hangzhou at the invitation of my friend Jack Ma to see for myself the success of Alibaba," Najib said in his blog.
"I was informed that Alibaba has created 36,000 jobs and changed the ecosystem of the business industry in China to be more dynamic and inclusive.
"Through the digital economy ecosystem spearheaded by Alibaba, businesses in the countryside can benefit from a world without borders," he added.
Najib then went on to tout Ma's role as Malaysia's digital economy adviser and his help in setting up the country's Digital Free Trade Zone, which the prime minister said would create some 60,000 jobs.
According to Bernama, Najib and his wife Rosmah Mansor, are scheduled to arrive in Hangzhou, where the headquarters of the Alibaba Group is located, tomorrow morning to observe the operations of China's e-commerce giant.
Malaysia's ambassador to China Zainuddin Yahya said that in Hangzhou, Najib would witness the signing of a memorandum of understanding (MoU) between Malaysia Digital Economy Corporation Sdn Bhd (MDEC) and the Hangzhou municipal government, as well as Alibaba Company Ltd.

Zainuddin said several MoU would be signed by Beijing and Putrajaya, involving the International Trade and Industry Ministry, Transport Ministry and the Agriculture and Agro-based Industries Ministry.
He added that several business (B2B) MoU would also be signed, involving cooperation, among others, in investment, finance, real estate and agriculture.
The prime minister will be attending the Belt and Road Forum for International Cooperation, which will also be attended by world leaders and the top Chinese leadership.- Mkini

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